No Changes to Voluntary Salary Sacrifice Benefits
Following the Autumn Statement, we can confirm that there are no impacts or changes to voluntary employee benefits we offer, including:
- Cycle to Work schemes
- Home & Technology schemes
- EV’s
- And Care-related benefits
These benefits continue to operate as normal and are not impacted by the Government’s announced changes to National Insurance (NI).
Understanding the Pension Salary Sacrifice Announcement
The Government has announced that, from 2029, employees who contribute to their pension via salary sacrifice will begin paying National Insurance on pension contributions above a £2,000 annual threshold. But it’s really important to put this into context:
- The change only applies to pension salary sacrifice, it does not affect non‑pension salary sacrifice benefits
- Income tax relief on pension contributions remains unchanged
- This change will potentially only affect higher and additional rate tax payers
- This change is not immediate!
This means pension salary sacrifice continues to offer meaningful value for both employers and employees.
Why Pension Salary Sacrifice Still Matters
Despite future changes to National Insurance, pension salary sacrifice remains a cornerstone of effective reward and wellbeing strategies. It still allows employees to save on tax and NI while building long‑term financial security in a structured, disciplined way.
Even with future NI changes, pension salary sacrifice remains one of the most efficient ways for employees to save for retirement.
Employer National Insurance Savings Still Apply
Employers continue to benefit from reduced employer NI costs on salary sacrifice pension contributions. Many organisations choose to share some or all of the savings by boosting employer pension contributions or offering a wider scope of benefits.
This flexibility makes pension salary sacrifice a powerful tool for enhancing employer value without increasing headline pay.
Supporting Long‑Term Financial Wellbeing
While voluntary benefits often support short‑term affordability, pension salary sacrifice plays a critical long‑term role in employee financial wellbeing.
It helps employees save consistently for retirement, improve pension outcomes without needing to “do more” actively, and they feel supported by an employer that invests in their future.
In an environment where financial confidence is under pressure, this long‑term support is more important than ever.
Salary Sacrifice and Today’s Cost‑Conscious Workforce
Research across more than 5,000 individuals in Europe shows that consumers are more cost‑conscious than ever. Nearly half expect to rely more heavily on flexible payment options, incentives and cost‑saving solutions.
This reinforces the importance of a balanced salary sacrifice strategy, combining:
- Short‑term, practical benefits (such as technology, cycles and care)
- Long‑term financial security through pension salary sacrifice
Together, these schemes form a holistic financial wellbeing framework.
A Stable, Cost‑Effective Solution for Employers
For employers, salary sacrifice continues to deliver:
- A cost‑effective way to enhance reward packages
- Strong employee engagement and retention benefits
- Clear alignment with wellbeing and ESG objectives
- Minimal disruption, even as legislation evolves
At a time when employers are under pressure to manage costs while still supporting employees, salary sacrifice remains a high‑impact, low‑cost solution.
Clarity and Confidence During Change
Legislative changes can create uncertainty, particularly when they affect pensions. Effective communication is essential.
What remains clear is that:
- Pension salary sacrifice is not being removed
- Voluntary salary sacrifice benefits are unaffected
- Salary sacrifice remains a trusted and established approach
We remain committed to supporting employers and employees with clarity, flexibility and confidence during periods of change.
Final Thoughts
While future changes to pension salary sacrifice should be planned for, they do not diminish the ongoing value of salary sacrifice as a whole.
For employers, these schemes continue to offer an efficient, flexible way to support wellbeing. For employees, they remain a vital tool for managing today’s costs while planning for tomorrow.
Our professional advice can help ensure salary sacrifice arrangements remain compliant, effective and aligned with both workforce needs and long‑term strategy.